2025 (11) TMI 933 - HC - GST

Writ petition dismissed where appeal rejected for non-compliance and merits under Section 107(6) GST Act

M/s. Digambar Road Lines Versus Commissioner (Appeals), GST, Central Excise & Customs, Central Revenue Building, Rajaswa Vihar, Bhubaneswar and others.

HC dismissed the writ petition. The court distinguished earlier Bench orders holding that appellate authority must point out pre-deposit requirement when ... Maintainability of appeal - compliance with the requirement of pre-deposit as per Section 107(6) of the GST Act, 2017 or not - HELD THAT:- The reliance is placed upon unreported orders of this Bench rendered in M/s. GAEA Engineers and Contractors Private Limited vs. Chief Commissioner of CGST & Central Excise, Odisha and others [2025 (11) TMI 493 - ORISSA HIGH COURT] and M/s. Harsheel Auto Planet, Sundergarh vs. Commissioner (Appeals), CGST, Central Excise & Customs and others [2025 (5) TMI 765 - ORISSA HIGH COURT], wherein it is held that the authority ought to have pointed out to the appellant in the event the appeal is filed in the physical form to deposit the statutory amount under Section 107(6) of the said Act. Having not done so, the dismissal of the appeal is per se illegal. The aforesaid decisions relied upon by this Court can be distinguished on the factual matrix and the ratio laid down therein has to be culled out in the context in which it is so used. In both the decisions so relied upon, it is found that after admitting the appeal and issuing the notice at the fag end of the hearing of the said appeal, the same was dismissed on a technical ground alone that the appellant therein has not complied with the mandatory provision contemplated under Section 107(6) of the said Act. The reason for not accepting the proposition as laid down in the above cases can be reasonably gathered from the fact that the appellate authority, while dismissing the said appeal assigned two grounds, firstly, non-observance and/or fulfilment of the conditions under Section 107(6) of the said Act; and secondly, on merit. The operating portion of the impugned order is suggestive of the aforesaid facts that the appeal was not only dismissed on technical ground but also on merit. The instant writ petition is filed assailing the judgment which decides the cause both on technical aspect as well as on merit, solely on the ground of technical aspect being de-hors the law. Therefore, if there are no justification warranting the interference on the findings returned on the merit of the case. This is not a fit case either to set aside the order in its entirety or remand the case to the authority for fresh hearing. Petition dismissed. ISSUES PRESENTED AND CONSIDERED 1. Whether an appeal under Section 107(1) of the GST Act can be entertained where the appellant has not complied with the payment conditions of Section 107(6). 2. Whether an appeal filed physically (in hard copy) after attempts to upload on the statutory portal but without portal access, and without the statutory deposits, must be treated as non est and thus incur a mandatory dismissal under Section 107(6). 3. Whether dismissal of an appeal on a combination of grounds (non-compliance with Section 107(6) and on merits) permits interference by writ jurisdiction when the appellate authority has also decided the matter on merits. ISSUE-WISE DETAILED ANALYSIS Issue 1 - Applicability and mandatory nature of Section 107(6) (legal framework) Legal framework: Section 107(6) mandates that no appeal shall be filed under sub-section (1) unless the appellant pays (a) amounts admitted in full and (b) ten per cent of the remaining tax in dispute (subject to a cap), with a specific proviso for certain orders. Interpretation and reasoning: The Court acknowledges the plain reading suggests a mandatory pre-condition to filing an appeal. The provision is procedural in nature and prescribes a condition precedent to the maintenance/entertaining of an appeal before the appellate authority. Ratio vs. Obiter: The proposition that Section 107(6) is mandatory is treated as ratio where relevant to the facts before the Court. Conclusion: Compliance with Section 107(6) is a condition precedent to entertaining an appeal; non-compliance can justify dismissal of the appeal on that ground. Issue 2 - Effect of filing a physical appeal after failed portal upload and whether such appeal is non est (legal framework) Legal framework: Procedural rules governing mode of filing (electronic portal v. physical filing) and the statutory pre-deposit requirement under Section 107(6) govern maintainability. Precedent Treatment: The petitioner relied on earlier bench orders where physical filing was accepted initially and dismissal for non-deposit was held to be per se illegal because the authority had admitted the appeal and issued notice without pointing out the pre-deposit defect. Interpretation and reasoning: The Court distinguishes those precedents on factual matrix. In the relied cases the appellate authority had admitted the appeal and issued notice, thereby proceeding with the appeal before raising the technical non-compliance; dismissal on that ground alone was held impermissible. In the present case, however, the appellate order assigned two distinct grounds-non-compliance with Section 107(6) and adverse findings on merits-so the earlier ratio does not apply directly. Ratio vs. Obiter: The distinction drawn between (a) appeals admitted and proceeded with by the authority then dismissed for technical non-compliance, and (b) appeals dismissed both on technical and substantive grounds, is ratio in context of application of the earlier decisions. Conclusion: Physical filing after failed portal upload does not per se render the appeal non est if the authority properly considers maintainability; however, where non-compliance with Section 107(6) is one valid ground among others and the authority also decides on merits, the mere technical defect does not automatically vitiate the entire adjudication. Issue 3 - Writ Court interference where appellate order rests on multiple grounds including merits (legal framework) Legal framework: Judicial review in writ jurisdiction is limited; interference is warranted where an order is per se illegal, irrational, unreasonable, or wholly perverse. The Court must scrutinize the process and legality rather than substitute its own view on merits. Interpretation and reasoning: The appellate authority dismissed the appeal on two independent grounds. The Court emphasises that when a decision rests on multiple grounds, invalidity of one ground does not automatically invalidate the whole order if other independent and valid reasons support the conclusion. The Writ Court must be slow to set aside findings on merits unless they are demonstrably perverse or outside legal parameters. Remand would be futile where the authority, if given opportunity to rectify procedural defects, would likely reach the same substantive conclusion after fresh compliance. Precedent Treatment: The earlier bench authorities were not overruled but distinguished; those decisions apply where the appellate authority after admitting the appeal later dismissed it solely on technical non-compliance, which is not the factual situation here. Ratio vs. Obiter: The principle that a multi-ground decision will not be set aside in toto if at least one ground sustains the outcome is treated as ratio in the Court's analysis of interference fitness. Conclusion: Writ interference is unwarranted where the appellate authority's substantive findings are not perverse, irrational or illegal and where the order is sustain-able on independent grounds of merit despite a technical defect in the proceedings. Issue 4 - Appropriate remedy where non-compliance with pre-deposit is alleged but merits also decided (interpretation and relief) Legal framework: Remedies include quashing, remand, or dismissal of writ depending on legality and efficacy of corrective measures; remand requires setting aside the impugned order and would consume time without altering substantive outcome if merits are sound. Interpretation and reasoning: The Court finds remand inappropriate because the appellate authority's merits-based findings are not shown to be perverse. Allowing remand solely to permit compliance with Section 107(6) would merely replicate the same merits conclusion after procedural cure, causing unnecessary delay. Conclusion: Neither quashing the impugned order in its entirety nor remanding the matter is justified where the merits are legally tenable; the writ petition is therefore dismissed.